POWER XINCHEN (01148) announced that on November 27, 2025, its wholly-owned subsidiary, Mianyang Xinchen Power Machinery Co., Ltd. (Mianyang Xinchen), entered into a strategic cooperation agreement with Sichuan Hongpeng Aerospace Equipment Intelligent Manufacturing Co., Ltd. (Strategic Partner) to establish a strategic alliance in the aviation piston engine field.
The primary objectives of the alliance are: (a) To integrate Mianyang Xinchen's strengths in automotive engine design, development, performance testing, industrialization, supply chain, and manufacturing with the Strategic Partner's expertise in aero-engine design, manufacturing, testing, FADEC control system development, aircraft-engine matching, and airworthiness certification. (b) To develop a phased product system for non-airworthy and airworthy aviation piston engines. (c) To enhance both parties' core competitiveness and market share in domestic and international aviation piston engine markets.
Under the agreement, Mianyang Xinchen will supply specific engine models to the Strategic Partner for conversion into non-airworthy aviation piston engines to meet demand from non-airworthy aircraft clients. In the second phase, the Strategic Partner will modify the procured engines into airworthy versions for certified aircraft customers.
In the third phase, based on accumulated experience and joint market assessments, the two parties may establish a joint venture focused on the design, supply chain development, production line setup, manufacturing, and sales of selected aviation piston engine models.
The Strategic Partner is a Chinese company specializing in civil aircraft and rocket propulsion, with capabilities in aero-engine design, manufacturing, testing, FADEC systems, and airworthiness certification.
This alliance provides POWER XINCHEN with accelerated entry into the high-barrier aviation market, particularly in airworthiness certification. It also aligns the group with national and regional low-altitude economy initiatives, facilitating policy support, funding, and government resources. Additionally, the alliance ensures stable order flow while expanding the group’s powertrain capabilities toward its vision of becoming a "world-leading propulsion systems provider."